In 2021, Formula 1 introduced a budget cap for all teams. At the time, it was 138 million euros. In 2026, the rule is set to change again. Currently, for example, only the three most expensive employees fall under the budget cap. In 2026, more employees are to be taken into account. As a result, the budget is also set to increase to around 215 million dollars. Is this the right way?
Horner: Budget cap must not be at the expense of F1 employees
Red Bull has been through a controversy with the budget cap. In 2021, the team violated the rule. As a result, the wind tunnel time was reduced. “We learned a lot from the budget cap. The important thing in 2026 is that employees will not pay for these changes. There is a discussion about what exactly will be included in the budget cap and what is really relevant for performance,” said Red Bull team boss Christian Horner.
“Does a Christmas party really make your car faster? If so, every engineer will want a front wing rather than a Christmas party,” Horner continued. It is therefore questionable how many employees in each team would be affected by the budget cap.
When the first budget cap was introduced, top teams in particular had to lay off their employees or let them move on to other projects and teams. Ferrari employees, for example, moved to Haas or the new Le Mans project. So which employees are really relevant to the team’s ultimate performance and should therefore be subject to the regulation? Currently, only the three best-paid employees of each team are included in the budget cap.
What counts as Formula 1 and what doesn’t?
Sauber team boss Alessandro Alunni Bravi is particularly concerned about loopholes in the regulations that could be exploited by the teams. “The aim will be to avoid areas that can be interpreted differently by the teams. Above all, what are or are not Formula 1 activities,” said the team boss.
Every year, all the engineers of the Formula 1 teams try to find loopholes in the technical regulations and thus stay one step ahead of the competition. If a team were to identify such a loophole in the financial regulations and thus potentially be able to spend more money, it would be fatal.
“Another goal is to create fair competition, especially in the area of car manufacturing,” says Alunni Bravi. Sauber has always been at a financial disadvantage compared to the other teams. The team is based in Hinwil in Switzerland. The costs are higher due to the Swiss franc compared to the other teams that work with the euro.
“For teams like ours, it is essential to introduce an element that evens out the differences in costs in different countries,” says Alunni Bravi. “Because there is of course a cost difference between Switzerland and other countries. I think we should bring all the teams to the same starting point. So that the decisive difference is created by the skills of the people and the quality of the work, not by other factors.”